The map that shows what austerity has done to NHS hospital deficits

Jon Stone reports in The Independent 8th March 2016:The map that shows what austerity has done to NHS hospital deficits.( Note that Wales, Scotland and N Ireland are excluded, in line with the WHO report – see next post – there is no NHS)


The financial position of the National Health Service has “substantially deteriorated” in recent years, a new analysis has found.

Research by the Health Foundation found that every area of the country had hospitals and other providers with struggling finances.

A striking map drawn up by the Foundation shows that all regions of the English NHS have gone from a surplus in 2012/13 to all but one being in overall deficit in 2014/5.

The problems are principally the fault of Government policies leading to an increased reliance on expensive agency workers, with funding failing to keep pace, the report says.

Anita Charlesworth, Director of Research and Economics at the Health Foundation said the poor state of finances was unprecedented, the result of “unrealistic” expectations by the Government, and that another five years of austerity would make things worse.

“NHS providers’ finances are in a shocking state with an unprecedented number of hospitals reporting deficits. The situation is particularly bad for acute hospitals, with 95 per cent in the red,” she said.

“Many of the factors linked to the deficit result from system-wide problems. The UK is half way through a decade of austerity and policy decisions have been made which mean that health spending per head of population has remained broadly constant in real terms.

“At the same time it has risen for many countries in Europe, albeit at a lower rate than before the economic crisis of 2008.

“The financial challenges facing our hospitals are not the result of weaknesses in the management of individual organisations. They stem from poor workforce planning and fundamentally an unrealistic expectation of efficiency improvement in the NHS. “

The report found that nationwide, the cost of providing healthcare was growing at 2.2 per cent a year, while funding was growing at only 2 per cent a year.

Productivity in the NHS also grew at an average of 0.1 per cent a year in the last five years – but ministers have budgeted for increases of two to three per cent.

The report says the key drive of the poor financial situation is the high cost of agency workers and poor staffing decisions leading to an increase in their use. 27 per cent more was spent on agency staff in 2014/15 as compared with 2013/14

The warning comes ahead of a further strike by junior doctors over Jeremy Hunt’s plans to force a new contract on them.

Doctors say the contract will incentivise unsafe staffing rosters and that patient care will deteriorate, while Mr Hunt says the contract will move towards a “seven day NHS”.

The Royal College of GPs warned last month that the new contract would likely make it more difficult to recruit NHS doctors – potentially increasing the reliance on agency staff and increasing costs further.

This entry was posted in Stories in the Media on by .

About Roger Burns - retired GP

I am a retired GP and medical educator. I have supported patient participation throughout my career, and my practice, St Thomas; Surgery, has had a longstanding and active Patient Participation Group (PPG). I support the idea of Community Health Councils, although I feel they should be funded at arms length from government. I have taught GP trainees for 30 years, and been a Programme Director for GP training in Pembrokeshire 20 years. I served on the Pembrokeshire LHG and LHB for a total of 10 years. I completed an MBA in 1996, and I along with most others, never had an exit interview from any job in the NHS! I completed an MBA in 1996, and was a runner up for the Adam Smith prize for economy and efficiency in government in that year. This was owing to a suggestion (St Thomas' Mutual) that practices had incentives for saving by being allowed to buy rationed out services in the following year.

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